Self-Evaluate. Are you barely able to pay the minimum monthly payments on your credit cards? Are credit collection hounds after you? Do you fear you can’t pay all your bills on time or have already missed some payments? If you answered yes to at least one of these questions, you’re ready to speak with a credit counselor.
Seek Certified Counselors. The Justice Department’s web site (usdoj.gov) has a list of approved credit counseling agencies, but don’t just for the first counseling agency that you come across online. Investigate the validity of each agency you’re considering by searching in chat rooms, blogs and on credit counseling advice sites like the National Foundation for Credit Counseling www.nfcc.org and the Consumer Credit Counseling Service. Additionally, check with your state attorney general’s office and local Better Business Bureau for complaints.
Finally, be instinctive. “Go with your gut feeling,” says Cunningham. “If the agent is pushing you and not listening to your situation you might want to try another agency…Remember, it doesn’t affect your credit score just talking to a counseling agency.”
Expect Honest Advice. The first thing you should anticipate from the free initial consultation is judgment-free advice. No one should be badgering you over your $3,500 Visa overdraft. You and your counselor should objectively review your income, expenses, various loans, credit card balances and the amount of interest you pay to understand your true debt obligations. Next, “[the counselor] will go over your budget and make suggestions for changing your spending habits,” says Detweiler. You may discover you have to take just a few steps to lower your debt load to a more manageable place. Or it may be decided that you need to take more aggressive action by either entering a debt-management program or even further – a Chapter 13 bankruptcy.
